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Tuesday, 26 May 2015

Why Oil Marketers Want Payment Before May 29

by Chika Amanze-Nwachuku

It
has emerged that the nationwide fuel shortage engineered by oil
marketers was done to pressurise the outgoing administration led by
President Goodluck Jonathan to pay them an additional N200 billion
comprising outstanding claims and foreign exchange rate differential,
even though the claims had not been verified and may have been spurious.

Investigations have shown that contrary to the position by the oil
marketers that they have been unable obtain new facilities from the
banks to import petroleum products, the marketers were bent on getting
the current administration to pay their claims before the end of its
tenure because they were uncertain that the new administration led by
Major-General Muhammadu Buhari would pay them on time.

Sources in the presidency disclosed that the marketers decided to hold
the nation to ransom in order to get their claims paid promptly by the
outgoing administration without consideration for other sectors of the
economy that need funding by government.

One source explained
that the urgency in their demands was triggered by the fear that Buhari
would insist on verifying their claims before paying them a farthing and
subsequently stumble on the fact that some of their claims are
spurious.

“As you know, despite the best efforts of government, some of the
claims by marketers are spurious. But in order to keep the fraud under
check, several audits are undertaken to confirm that the products the
marketers claim they have imported is what has been discharged at the
depots and sold to Nigerians,” the presidency source explained.

He revealed that what some marketers do to beat the system is to
discharge fuel at the depot, wait for PPPRA to verify the quantity they
have discharged and then backload it into their vessels, and go and
resell the fuel on the high seas.

“Then they make subsidy claims for petroleum products that were not
actually discharged or sold in the country and make money from both
ends.
“Now to eliminate such sharp practices, further verification is carried
out by independent auditors after the one by PPPRA before their claims
can be paid. “However, this takes time and is the real reason the government takes its time before paying marketers,” he added.

The presidency sources also explained that the foreign exchange rate
differential and interest rate charges was another issue which the
Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi
Okonjo-Iweala, had insisted must be verified by the Central Bank of
Nigeria (CBN) before further payments could be made to the oil
marketers.

“A committee headed by the CBN was set up to verify the so-called
foreign exchange rate differential, but the marketers kicked by reneging
on their promise to end the fuel shortage.
“So these are the real issues; the entire fuel crisis was a ploy to put
pressure on the Jonathan administration to pay them before the end of
its tenure. But Okonjo-Iweala refused, insisting that all subsidy claims
and the foreign exchange rate differential must be verified before
further payments could be made.
“She also argued that if this administration is unable to verify their
claims before May 29, the next administration will continue with the
process because government is a continuum. But the oil marketers tried
to sabotage this by making fuel unavailable, hoping that this would
force the finance ministry to pay,” the source said.

To allay the concerns of marketers over payment by the incoming
administration, the presidency source further revealed that minister has
written a letter to the Major Oil Marketers Association of Nigeria
(MOMAN) and Depot and Petroleum Products Marketing Association (DAPPMA)
acknowledging that the government owes them some N291 billion as at May
2015, of which N160.5 billion is the foreign exchange differential.

But the same letter states that a committee comprising the CBN, PPPRA
and the finance ministry is verifying the claim on the foreign exchange
differential and payment can only be made by the federal government if
the amount is verified, the source explained.

“If it is not verified, it will not be paid by the new government,” he said.